What about the Workers? Simon Clarke, Peter Fairbother, Michael Burawoy and Pavela Krotov 2 Contents 1 Introduction: Class Struggle and the Development of Capital- ism in Russia 5 2 The Contradictions of `State Socialism' 9 2.1 Was the Soviet Union Capitalist? . 11 2.1.1 The Soviet Union and the international law of value . 12 2.1.2 Money, value and planning in the Soviet system . 14 2.2 The Social Relations of Soviet Production . 16 2.2.1 The Western model of the Soviet enterprise . 16 2.2.2 The functions of enterprise management . 18 2.3 `Workers' Control' and the Control of Workers . 20 2.3.1 Formally rational control: the piece-rate system . 22 2.3.2 Hierarchical relationships and the labour surplus . 22 2.3.3 Distribution and the social functions of the enterprise . 26 2.3.4 The labour collective . 27 2.4 The Fundamental Contradiction of the Soviet System . 28 3 The Crisis of the Soviet System 33 3.1 A Crisis of Class Rule . 33 3.2 From Stagnation to Crisis: The Soviet Union in the World Economy 36 3.3 Perestroika in the Crisis of World Capitalism . 39 3.4 The Reform of the System of International Trade . 41 3.5 The Soviet Crisis and the Crisis of World Capitalism . 44 3.6 The Contradictions of Perestroika . 47 3.7 Perestroika and the Crisis of the State . 51 3.8 The Crisis of the Soviet State and the Crisis of World Capitalism 54 4 The Soviet Transition from Socialism to Capitalism:Worker Con- trol and Economic Bargaining in the Wood Industry 57 5 Trade Unions and the Working Class 59 5.1 The `Dual Functions' of Soviet Trade Unions . 60 5.2 Trade Unions and Democratic Centralism . 61 5.3 Trade Unions and the Struggle for Production . 64 3 4 CONTENTS 5.4 The Unions and the Working Class. 67 5.5 Management, Party and Union in the Workplace . 68 5.6 Production, Distribution and the Collective Agreement . 69 5.7 Wages and Production Norms . 71 5.8 Union Organisation in the Enterprise . 73 5.9 Disputes and Grievances . 74 5.10 The Limits of Collusion: Conflict in the Enterprise . 77 5.11 Trade Unionism and the Brigade System . 79 5.12 Trade Unions and the Labour Collective Council . 82 6 Beyond the Mines: The Politics of the New Workers' Move- ment 87 6.1 The Workers' Movement in Sverdlovsk . 89 6.2 The Workers' Movement in Leningrad . 91 6.3 Sotsprof . 93 6.4 Politics and Economics: The Limits of the New Workers' Movement 96 7 The Strikes of 1991 and the Collapse of the Soviet System 103 7.1 The 1991 Miners' Strikes . 103 7.2 Politics and Economics in the Workers' Movement . 109 7.2.1 Regional differences in the miners' movement . 110 7.2.2 The Belorussian strikes . 111 8 After the Coup: The Workers' Movement in the Transition to a Market Economy 115 8.1 The Independent Miners' Union . 118 8.2 The Resurrection of the Official Unions . 122 8.2.1 National union organisations . 122 8.2.2 Regional trade union organisations . 126 8.2.3 The branch unions . 128 8.3 Enterprise Unions in the Transition to a Market Economy . 130 8.4 The Struggle Continues . 135 9 Privatisation and the Development of Capitalism in Russia 139 9.1 The Development of Capitalism in Russia . 139 9.2 The Law on Co-operatives and the Development of Capitalism . 141 9.3 The `Destatisation' of the State Enterprise . 144 9.4 From Destatisation to Privatisation . 149 9.5 Spontaneous Privatisation and the Development of Capitalism . 152 9.6 The Industrial Nomenklatura, Privatisation and the Development of Capitalism . 153 9.7 The Neo-Liberal Programme . 157 9.8 Privatisation and the State . 159 9.9 The Privatisation Programme . 164 9.10 The Reproduction of the Soviet Enterprise in the Market Economy168 9.11 Privatisation and the Class Struggle . 173 Chapter 1 Introduction: Class Struggle and the Development of Capitalism in Russia Simon Clarke There has been a remarkable degree of unanimity, on both the left and the right, in interpretations of the dramatic events in the Soviet bloc over the past few years. The collapse of state socialism under the weight of its own contradictions unleashed political and entrepreneurial forces which had been repressed for decades. Following the overwhelming popular demand for freedom and democracy, the dismantling of the `administrative-command' system of state economic management led to the rapid development of a market economy and capitalist enterprise, which provided the basis for a transition to capitalism which would be completed by privatising the bulk of the productive sector of the economy. According to this interpretation the primary political division underlying these changes was between those who wanted merely to reform the administrative- command system and those who sought to overthrow it. As successive waves of more or less radical reform were absorbed by the system without overcoming its fundamental contradictions, the balance of political forces moved inexorably in favour of those who sought its overthrow, and saw the only future in a more or less rapid transition to capitalism. As the centre began to collapse there was a remarkably rapid political polarisation throughout the Russian Empire, with the political pendulum swinging rapidly and overwhelmingly in favour of the liberal democratic political forces, which, outside Russia, were able to mobilise nationalist sentiment in their support. This polarisation was most dramatic and most rapid in the Soviet satellites 5 6CHAPTER 1. INTRODUCTION: CLASS STRUGGLE AND THE DEVELOPMENT OF CAPITALISM IN RUSSIA of Eastern Europe, but the changes in Eastern Europe were only possible be- cause a parallel polarisation of forces was occurring in Russia itself. On the one hand were the `new democrats', who came onto the political scene with the 1989 elections to the Supreme Soviet of the USSR, and who triumphed in the Republican and municipal elections in 1990, finding their figurehead in Boris Yeltsin. On the other hand was the old apparatus of the Party, the adminis- trative structures of the state, and the military-industrial complex, desperately trying to hold on to the levers of bureaucratic power. Gorbachev sought inde- cisively to maintain the centre ground, but the rapid polarisation of political forces in the face of the disintegration of the Union and the strike wave of the spring of 1991 left Gorbachev isolated as the centre ground disappeared from under his feet. The attempted coup of August 1991 marked the bankruptcy of Gorbachev's centrism as much as it did the desperation of the old guard. With the failure of the coup the political basis for the rapid transition to capitalism was secured. Yeltsin had unchallenged political authority, which enabled him to concen- trate administrative power in his own hands. He used this power to introduce a radical programme of an accelerated transition to capitalism, based on the `monetarist' programme of shock therapy agreed with the IMF and the World Bank and implemented by the Gaidar team and its Western advisers who, long discredited in their home countries, poured in to speed the transition to cap- italism. This programme proposed the immediate freeing of prices and the rapid removal of subsidies, in order to purge the pent-up inflation, eliminate the budget deficit, and prepare the ground for a crash programme of privatisation. The government promised six months of pain and two years of hardship, to be followed by steady recovery led by the new forces of capitalist enterprise. Through 1992 the press in Russia and the West slavishly followed Yeltsin's government's line that Russia was locked in a political struggle to the death, between the neo-liberals struggling for reform and the conservative forces which sought to reverse all the reforms and return to the old order, culminating in the dramatic struggle between Yeltsin and the Congress of People's Deputies from December 1992. The democratic left, in Russia and abroad, viewed developments with mount- ing alarm. While few were willing to defend the `achievements' of state socialism, many were horrified at the extent to which the Yeltsin government was riding roughshod over the interests of workers, to say nothing of the more vulnerable groups, and particularly women, the sick and disabled, and pensioners. Faced with the choice between neo-liberals and conservatives, the majority of the left found themselves, perhaps with some reservations, sympathising with the latter. The underlying theme of this book is that this is a false choice. The po- litical and ideological struggles within the ruling stratum are important, but the future of Russia is not being determined in the corridors of the Kremlin, not least because the collapse of the administrative-command system also led to the disintegration of state power. Political struggles reflect the fragmenta- tion of the ruling stratum, but do not express a struggle for power between two classes. To understand what is happening in Russia we have to look beneath 7 these political struggles to the foundations of class power in the social relations of the production and appropriation of a surplus on which class power is based. The fundamental struggle over the direction of change is not being fought out in Moscow, but in enterprises and organisations the length and breadth of the country, in which the mass of the population live through, and struggle against, their exploitation and their subordination. In short, this book is about the subversive undercurrent of social life, the class struggle. The aim of this book is not to provide an account of the twists and turns of perestroika, which is already well covered by a large literature.